The Mayor of Liverpool has written to Business Minister Michael Fallon urging him to reconsider a decision to slash up to more than £200m in funding to the city.

Cllr Joe Anderson fears European funding to Liverpool City Region will be reduced by up to £290m.

City leaders and members of the Local Enterprise Partnership (LEP) have been lobbying the Government over fears that a significant share of the cash that was expected to flow into the Liverpool City Region is more likely to be diverted to Wales, Scotland and Northern Ireland.

At a meeting last week between representatives from Liverpool, Sheffield and Whitehall officials, they were told to expect funding for 2014-2020 equivalent to the last three years of the current European programme.

In a letter to Business Minister Michael Fallon, Mayor Anderson said he was “struggling to understand” how the Government could justify its rationale of protecting devolved regions from cuts, when the impact on Liverpool will be a “draconian” cut to an area with a lower GDP than Scotland, Wales or Northern Ireland.

Mayor Anderson, chair of Liverpool City Region Cabinet, said: “What is being proposed flies in the face of the whole purpose of the funding.

“It is explicitly designed to help areas such as ours which are lagging behind, to improve their economic performance.

“Instead, we have a situation where the funding is effectively being robbed, and given to areas which aren’t as badly off. We are in the ludicrous position where we will lose out, while wealthier and more prosperous areas will gain.

“I am asking the Minister to review the decision on funding allocations, which are plainly and unfairly penalising areas such as Liverpool City Region.